Posted on 06/09/2019 4:06:40 PM PDT by reaganaut1
The experience of repaying student loans is unpleasant for millions of graduates, but for some borrowers, paying off student debt is an almost insurmountable challenge.
Twelve years after entering college, white men have paid off 44% of their student-loan balance on average, according to an analysis released Thursday by Demos, a left-leaning think tank. For white women, that share drops to 28%. For black borrowers, the picture is even bleaker. Black women see their loan balances actually grow 13% on average, 12 years after leaving school, while black men see their balances grow 11%.
The age at which students enter college also plays a role in their ability to pay off debt. Students who start college at age 20 or older have paid off just 5% of their debt on average, at minimum, 12 years after leaving school. Students who enter school at age 18 or 19 have typically paid off more than one-quarter of their debt 12 years after leaving college, the report found.
“We think of the ability to pay off student debt as only having to do with student debt,” said Mark Huelsman, associate director, policy and research at Demos and the author of the report. “We know the ability to pay off your loans has everything to do with wages and the ability to gain secure employment, it has everything to do with housing affordability, it has everything to do with child-care costs.”
Huelsman’s analysis is the latest to indicate that structural inequities mean that the student-debt burden is experienced differently by different types of borrowers and that a borrower’s demographics dictate in part how much of a financial benefit they get out of their degree. Undoing the harm caused by the nation’s $1.5 trillion student-loan problem requires a broader solution
(Excerpt) Read more at barrons.com ...
Privatize student loans, and lenders will prefer borrowers with good academic records and majors likely to lead to gainful employment.
The "analysis" is Debt to Society.
Maybe white men are most willing to work three jobs for specific financial goals.
How about not encouraging kids to spend money they do not have to obtain a worthless piece of paper? Now if they chose a profession that is actually in demand and a cost benefit analysis shows they will earn back the cost of the paper that may be a different story. More need to become craftsman anyhow money is just as good and you get paid while learning.
Graduates of Historical Black Colleges are also woefully unprepared.
The author has the causality arrow reversed.
I would bet, on careful analysis, you would find the degree has much more to do with how much financial benefit they get, than the demographics.
There is an incredible demand for black women with engineering degrees.
My experience is that minorities and women have tremendous advantages in obtaining jobs. It is called affirmative action.
We can’t divorce this conversation from race and privilege,
Holy cow. I paid off my students loans within 2 years of leaving college. And that was on piddly 2nd Lt pay.
What majors do white men take? What majors do black women take? The answer is most likely - make that most certainly - there.
Perhaps difference in upbringing lead whites to understand better the consequences of NOT paying off their loans whereas blacks tend to just not ever start to pay, resulting in their balances CLIMBING over time.
Blacks in general especially black women don’t feel they have to pay back anything this is where the gap is
This is 100% bullsh!t.
What this analysis SHOULD have done is add another variable: What were the test scores and admissions standards used to admit these students to college in the first place?
You're seeing a natural consequence of affirmative action in college admissions. Black graduates aren't paying off their student loans because a disproportionate number of them didn't even belong in the colleges and universities that graduated them.
White males, meanwhile, stand in line behind every other racial, ethnic and gender group when it comes to the admissions process -- which means the ones who DO graduate are truly the cream of the crop.
Try normalizing by major and income. Worthless “Studies” majors will pull down the income potential and ability to repay loans and probably moves the averages down for women and minorities. On the other hand a black woman engineer is rare and can make mint from HR departments eager to check off special groups.
The other politically incorrect consideration is differences in attitudes of various ethnic and social groups toward financial responsibility. Many coming from poorer backgrounds tend to have a poor understanding of money management.
Because white men are generally more responsible?
JoMa
I could say, but it would get me labeled as a “racist”......
"What dis sheeatt? Doe know nuffin bout no loan!"
I think Stacey Abrams needs to be part of this discussion. She knows all about paying off debts to the government.
. A friend of mine just got his car repoed, his electric has been turned off many times for not paying; always has smokes & weed though.
My white son had his student loan paid off within 5 years after graduating. Granted, his wasn’t that large as he was only in debt for just over a year’s tuition, iirc. We paid his first 4 years and he changed his major his senior year, so he was responsible for the additional semesters. It was far sooner than his payment schedule required, and I’m very proud of him for doing it. And, it was a smart decision for him to switch his major because he ended up with a very good job.
My white male son did a few things right.
He majored in an actual field, Astronautical Engineering.
He earned a few scholarships.
He went to a small private college that is fiscally responsible, doesn’t have a big name (outside his field) and no sports teams to suck up money.
He worked summers
He got a job in his field while in school to pay much of the cost.
He limited his debt.
We lent him money but gave him none. We did pay his car insurance and cell bill.
He got a job within two weeks of graduating.
He rents a house with five other guys and lives cheap.
He still drives his 14 year old car.
He paid off his entire college debt, $27,000 within 13 months of graduating.
None of that is privilege. I think the school is about 30% minority with the identical opportunities.
The first problem is getting into debt in the first place. I paid for my children’s college so they would not start off life in debt. A root problem is lack of financial savvy by many parents and their children who don’t save or deal with debt properly. I say that as someone who had nothing and worked for everything I got.
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